Google, branding, and the beauty of zero

If you were in a discount shoe store and saw a beautiful new pair of Nike tennis shoes on sale for $11.99, how would you react?

If you’re like me, you would conclude something is wrong with the shoes! Nike has spent millions to groom and nurture their brand and cutting the price only diminishes their premium image.

So what would you think of the brand image of a product that has a price of ZERO?

This was the subject matter of a little “twit-à-tête” between myself, my friend Steve Dodd, and a few others on Twitter yesterday. I had suggested in my last blog post that small businesses need a free, cross-platform social media metrics dashboard.

That started a round-robin of tweets (yes, pun was intentional) regarding why it had to be free and the impact that price would have on brand equity. Steve’s comment was: “Why should comprehensive measurement tools be free? In my opinion, if they are monetized other ways, their credibility tanks.”

Steve is a keen intellect and when he speaks, I listen. Certainly using my Nike example as a model, he’s absolutely right.

But then I thought about the revolutionary, brand powerhouses like Google, Facebook and YouTube. For you and me, the price of their products is zero, yet they have convincingly nurtured an extremely strong brand in the mind of consumers.

Consumer products in the same price range as Google would be a paper towel in a public restroom, a salt packet at McDonald’s and a toothpick. Think about THAT as a weird business model!

Can you think of another example in history where a company carved out a premium product image (like Google) with a price of nothing? Have we entered a new era of marketing where, in some cases, a brand image can be completely disconnected from price?

How about Media? TV, Radio, Newspapers? Or the (old paper version of) Yellow Pages? Generally all products/services that are connected with advertising I guess we can associate with quality, although it's free…

MARK W. SCHAEFER

Of course this is an accurate view, Benny, thanks for pointing it out.

I had thought about these models and the brand value of NBC or CNN, for example. This is a subtle point, but you still have at least a mental investment in the brand by the constant product interruption of commercials. It would be like Google interrupting your search to show you a 30-second ad in between results. So it's not a financial investment, per se, but certainly a personal expenditure of time. And today of course we pay for cable or satellite to access the channels.

Once an economic model emerged (like DVR or YouTube) where we could watch video without the personal time investment, people left the traditonal networks in droves and their model is collapsing.

I love the Yellow pages idea — the First Google! : )

Thanks so much for contributing your ideas, Benny!

steve dodd

Hmm, not a lot of commentary here. So, everyone agrees that Social Media Monitoring and Measurement tools need to be free for small businesses? Kinda like Google and Facebook et al? I've even heard some what them free, period. After all, isn't social media free too?

Well, let's start with this. Do you want your data and analysis delivered based on the same concept that data and advertising is delivered to you through Google et al? What you really are getting is data that is fed to you based on someone else's priority, typically based on who pays to be "your" priority. It's free to you because it is NOT free for them. And their ultimate goal is that you'll spend money as a result of the content they are feeding you.

Meredith P. Goins

I would pay nothing to use Google, either as a search engine or as an analytical tool, which I loved in a previous nonprofit life! I would pay nothing. Never.

Google already tracks my usage, can they pay ME for that? They're doing their market research using my search terms.

of course, I have something that others don't. I'm a librarian! The value Google offers to me is much lower than the average user.

MARK W. SCHAEFER

@steve @meredith — fascinating perspectives. Thanks for sharing.

MD Winn

What a brilliant pic with Bart. I'm rollin' on the floor right now. Sorry I missed the dialogue. Working with SMB and NPs freemium models to start are essential to allow them into the social media game.

Companies that provide scaling fees based on features or number of users beginning at free to start – seem to have sustainable momentum.

Anyway, great topic Mark.

MARK W. SCHAEFER

Thanks for stopping by the blog, Michael!

Jeff Hurt

So what about the Super Bowl? Costs you nothing to watch on your TV or the Internet, except time or commitment to watch ads? Costs you plenty to attend face to face.

Look at the boxing industry. They moved their events to a pay per view model and lost on a ton of revenue because no one wants to pay. Plus they lost money from promotions (sponsorship, logoed products, etc.)

Or how about some conferences? I've worked at some places where we planned conferences and events that were free to attendees. No registration fee to attend. Many unconferences offer free registration as well.

And here's a spin on this discussion for you. I ran a Texas' statewide initiative where we paid people to attend full day training on environmental issues. Yep, paid them $50 to attend. 90% of the attendees gave us the $50 back at the end of the training. Then we paid attendees another $50 if they spent two hours sharing what they learned in our presentation with a minimum of three peers. The program was funded by grants and the goal was attitude and behavior change. It was extremely successful. Research two and three years after the event showed attendee behavior change had occurred.

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